PRINTER VERSION BACK NEXT Exercise 12-2 (Video) Your answer is partially correct. Try again. Doug's Custom Construction Company is considering three new projects, each requiring an equipment investment of $23,100. Each project will last for 3 years and produce the following net anual cash flows. Year 1 2 3 AA $7,350 $10,500 $13,650 9,450 10,500 12,600 12,600 10,500 11,550 $29.400 $31,500 $37,600 Total The equipment's salvage value is zero, and Doug uses straight-line depreciation. Doug will not accept any project with a cash payback period over 2 years. Doug's required rate of return is 12. Click here to view table. (a) Compute each project's payback period (Round answers to 2 decimal places, ... 15.25.) AA years Be years years With the rentart? Exercise 12-3 (Video) your answer is partially correct. Try again Hillsong Inc, manufactures snowsuits. Hilsong is considering purchasing a new sewing machine at a cost of $2.45 million. Its existing machine was purchased five years ago at a price of $1.8 million six months ago Hillsong spent $55,000 to keep it operational. The existing sewing machine can be sold today for $245,788. The new sewing machine would require a one-time, $85,000 training cost. Operating costs would decrease by the following amounts for years 1 to 7: Year 1 2 3 4 $389,300 399,900 410,000 425,500 432,400 434,500 438,000 5 6 7 The new sewing machine would be depreciated according to the declining balance method at a rate of 20%. The salvage value is expected to be $379,400. This new equipment would require maintenance costs of $98,800 at the end of the fifth year. The cost of capital is 9%. Click here to view.py table. Use the net present value method to determine the following: (if net present value is negative then enter with negative sin preceding the number ... -45 or parenthesese..(45). Hound present value answer to 0 decimal places, e.g. 125. For calculation purposes, use 5 decimal places as displayed in the factor table provided) Calculate the net present value Net present value